By Leo Fasciocco -- TTD
Ticker Tape Digest presents its daily stock market report containing stocks to go long as breakout trades, quick trades, or bargain trades. We also feature stocks under Significant Accumulation that are poised to breakout.
Ticker Tape Digest's Trading Strategies Overview and Performance
Aggressive Investors Bullish - "Breakout Stocks" - ideally suited for bull markets and special situation stocks. Potential for large returns.
Aggressive Investor Bullish- "Quick Trade Stocks" -ideally suited for entry into top performing issues looking for a small quick profit."
Conservative Investors "Bargain Buy Trades" (swing trades). Ideally suited for entry into stocks on pullbacks within overall up trend. Good for trading range markets
Aggressive Bearish Investors - "Breakdown Stocks" to Sell Short. Ideally suited for bear markets or market pull backs. Potential for large returns
Conservative Bearish Investors (swing traders). "Bargain Bearish Plays" to Sell Short. Ideally suited for trading range markets with overall market down trend.
The TTD report also contains stocks to short as breakdown plays and as bargain (swing trade) shorts.
Investors should tend to try to go with a strategy that fits with the stock market's trend, unless there is a special situation play.
TTD's Breakout Stocks - Long are most suitable for aggressive investors seeking ideal entry points into leading stocks, especially during bull markets. They can do extremely well in bull markets with gains of as much as several hundred percent.
These stocks can also do extremely well during strong market rallies, or if they are in a industry group that is performing very well. They tend to have strong earnings outlooks and are near new-52 week, or all-time highs.
TTD Quick Trade Stocks - Long These are leading issues that have pulled back in recent days, but could move higher soon. They are most suitable for Aggressive Investors willing to trade short term. These stocks will do extremely well during market advances. They have about 74% win rate. During market rally sequences the win rate is even higher. The return is small 3% to 8% in just a few days.
TTD's Bargain Buy Trades - Long These are for conservative bullish Investors The strategy is called swing trading. These long buys are ideally suited for entry into stocks on pull backs within overall up trend. They are good for trading range markets. These stocks can give a good return in a week or two. They can also explode into a breakout and a powerful advance.
TTD also presents Stocks To Sell or Sell Short. These issues are suitable for aggressive investors willing to take short positions both as trades or for longer-term plays. These stocks will do very well during bear markets or market pull backs.
TTD's Bearish breakdown stocks to sell short. These issues have potential to fall sharply. They often show a technical breakdown and also some fundamental business problem such as weak earnings.
TTD's Bearish bargain play stocks to sell short. These issues are usually in down trends and are poised to rollover after a minor rally. They often can provide a conservative bear with a good entry point.
TTD's multi-media updates include a slide-show that presents charts and analysis at midsession. Some times TTD presents feature analysis on stocks and the market. TTD uses Windows Media Files. (WMV).
TTD also presents a "Breakout Watch List" that is up dated daily. This list consists of key stocks in position to breakout. A close watch of this list can put you in the stock just as it breaks out. A good idea is to study the list and be ready to move into a stock quickly as it hits its breakpoint.
TTD often suggests using stop buy orders to enter. It is very important to buy a breakout stock as close as possible to the breakpoint. The idea is to get "elbow room" if the stock should follow through to the upside. This is very important in being successful in making big money with breakout stocks.
It is also essential to have a stop loss strategy for all stocks in which positions are taken. Not every stock will work as expected. It is important for investors to "police" their portfolios and avoid getting trapped in any bad positions.
Quality rating of breakout Two key factors: 1 - Stock near all-time in price or near a 52-week high. 2 - earnings growth current year is strong. The ideal play is a stock with an Above Average Quality Rating. The stock is near a new high and will have strong earnings.TTD's other ratings are Average and Below Average.
TTD also has special feature sections on Educational Tips on Investing.
To email Mr. Leo Fasciocco firstname.lastname@example.org.For service, email Beverly Owen email@example.com. TTD’s Tel: 1-480-926-1680.
Stocks Screened - 8,200
Bull side - Stock market falls broadly for third straight day. Only a few breakout stock. Bulls now be very selective and conservative on new positions. Be watchful of all positions and honor your stop strategy. Both daily and weekly market indicators are bearish.
(Put mouse on Dow chart to see Nasdaq chart)
Long Term Environment for bulls: Favorable
Market (Daily) - NYSE Bearish, Nasdaq Bearish
Market (Weekly) - NYSE Bearish, Nasdaq Bearish
Market (Monthly) NYSE Bullish, Nasdaq Bullish
TTD's Quality Rating of Stock - CFN - AVERAGE
CFN, based in San Diego, Ca., produces medical products. Annual revenues: $3.6 billion. CFN came public last year. Today, the stock breaks out from a nine-week flat base. The stock's action is very bullish considering it moved against a broad decline in the stock market Friday. So far today, CFN is trading 2 million shares, double its normal daily volume of 1 million shares.
TTD highlighted CFN as a breakout at our midsession show on the Web Friday.
CFN's 5- minute chart shows the stock breaking out early in the day. The follow through after the breakout was impressive.
In the afternoon, the stock consolidated its position.
TTD's clip of the tape shows the recent big block trades.
One can see a big block of 50,000 shares crossing the tape at $27.82. That was up from the prior block's price of $27.75.
The tape action indicated good institutional buying interest.
CFN offers products in the areas of intravenous infusion, medication and supply dispensing, respiratory care, infection prevention and surgical instruments.
Its primary product brands include Alaris IV infusion systems that feature its Guardrails software, an application that alerts the clinician when a parameter is outside the institution’s pre-established limitations for that medication.
That helps to reduce IV medication errors.
CFN also makes Pyxis automated medication dispensing systems that provide medication management and Pyxis automated medical supply dispensing systems.
It also produces AVEA and Pulmonetic Systems ventilation and respiratory products, and Jaeger and SensorMedics pulmonary products, and ChloraPrep products that help prevent vascular and surgical-site infections.
CFN's performance chart going back about six months shows the stock appreciating 50%. It has outperformed the stock market.
CFN's long-term chart is very bullish. The stock is a "new-name issue." It is untarnished by the prior bear market. That is very bullish.
CFN's daily chart shows the advance from 18 to 27. The subsequent base showed two shakeouts to the downside. Then CFN held near the top of the base. Today, it breaks out. That is an ideal pattern for bulls.
The stock's TTD momentum indicator (top of the chart) is strongly bullish.
The accumulation - distribution line (bottom of chart) is hitting new peaks. That is very bullish and puts the "rubber stamp" on the stock that strong buying is taking place.
CFN's net for the fiscal year ending June 30 should come in at $1.47 a share. There are no comparable figures for a year ago. At that earnings pace, the stock has a price-earnings ratio of 18, which is reasonable.
The company said Thursday it will donate $3.1 million in equipment for Haiti.
A few years ago, the FDA put a stop to the marketing of the firms Alaris SE line of pumps. They were pulled because of problems with the keyboard. Earlier this year, the FDA gave the green light for a resumption in the production of the product.
Looking ahead to 2011 ending in June, analysts project a 14% gain in net to $1.67 a share from the anticipated $1.47 a share.
Near-term net for the upcoming fiscal second quarter ending Dec. 30 should be 38 cents a share. No comparable figure was available.
Strategy Opinion: CFN is a strong acting IPO stock from a few months ago. TTD is targeting CFN for a move to 35. A protective stop can be placed near 25. TTD rates CFN a good intermediate-term play provided earnings growth remains on course.
Sponsorship: Good. The largest fund holder is 3-star rated Dodge & Cox Stock Fund with a 4.7% stake. It has held its position steady. CFN has 221 million shares outstanding.
Insider Activity: Slightly Bearish. A key seller of 4.2 million shares in December was Cardinal Health Inc. Two analysts follow the stock and both have a buy, up from one buy three months ago. The second largest holder is 4-star rated T. Rowe Price Mid-Cap Growth Fund with a 2.7% stake.
Stock Performance Chart for 12 months with Quarterly Earnings Markers.
TTD's Breakout Profile Rating
CareFusion Corp. - (CFN)
|TTD Check List||Bullish||Bearish||Neutral|
|Near 52-week High||YES|
|Price Trend - Daily||YES|
|Price Trend - Long Term||YES|
|Price Daily Spread||YES|
|Base - A-D||YES|
|Prior Breakout Success||YES|
(The “breakout List” gives all stocks breaking out of a base of five weeks or more. These stocks have a good chance to trend higher. However, a stop should be used to avoid those that do not work. They are ranked according to percentage change and classified as leaders or other. (Trading strategy: One should buy breakout stocks at breakpoint by using market order or stop buy)
Charts of Selected Breakout Stocks
|TTD's Quality Rating of Stock - EBR - BELOW AVERAGE|
|TTD's Quality Rating of Stock - WTFC - BELOW AVERAGE|
|TTD's Quality Rating of Stock - SPRD - BELOW AVERAGE|
|TTD's Quality Rating of Stock - EWBC - BELOW AVERAGE|
Ticker Tape Digest’s Daily List of “Stocks To Sell Short” ranks stocks well timed to be sold immediately based on daily trading. The list can be used as an alert to reduce current long-term positions.
Shorts from tape action so far today - 11
Stocks Screened - 8,200
Long-Term Environment for bears: Unfavorable.
Bear Side - Breakdown list expands as stock market moves sharply lower for the third straight session. Bears be alert and more aggressive. We move toward February which is a bearish month seasonally.
(Trading strategy: These stocks can be sold short, or if held should be sold. If a stock is sold short, a protective stop buy should be placed. Short plays work best when the stock market is in a down trend.)
HOG, based in Milwaukee, produces motorcycles. Annual revenues: $5.3 billion. HOG's stock falls sharply today after the company reported a large loss for the fourth quarter. The loss was wider than expected and the stock responded bearishly to the news. So far today, HOG is trading 10.4 million shares, triple its normal daily volume of 3.4 million shares. TTD sees a further trip south for HOG.
HOG reported a loss for the fourth quarter of 94 cents a share compared with a loss of 34 cents a share a year ago. The loss was more than the consensus estimate of a deficit of 34 cents a share. The largest loss was estimated at 48 cents a share.
So, HOG's report showed a much bigger loss than the Street expected.
The company blamed weak consumer spending and tight credit markets for the poor results.
Revenues to dealers tumbled 46%.
HOG's stock fell at the opening, but then rallied to erase a chunk of the loss. However, the stock headed lower again. In the afternoon, the selling abated, but late in the session more selling came in. The stock has a beta of 2.26 which means it is twice as volatile as the stock market.
TTD's clip of the tape shows a big block of 118,100 shares crossing late on Thursday at $25. That was down sharply from the prior block that went off at $25.58. TTD sees the stock under heavy institutional selling pressure.
HDI does business as Harley-Davidson Motor Company, Buell Motorcycle Company and MV Agusta .
The Motorcycles segment designs, manufactures and sells at wholesale primarily heavyweight (engine displacement of 651+cubic centimeters) touring, custom and performance motorcycles, as well as a line of motorcycle parts, accessories.
The fourth quarter estimate would indicate that HOG will post a loss of about 25 cents a share compared with a profit of $2.79 a share a year ago. Looking out to 2010, the Street is projecting a profit of $1.32 a share.
HOG's stock chart shows a break below key support at $24.88. The stock's TTD momentum indicator (top of chart) has been bearish for several weeks.
Strategy Opinion: TTD is targeting HOG's stock for a decline to 18 within the next few months, or sooner. A protective stop buy can be placed near 26.
TTD columnist Leo Fasciocco has covered the stock market for over 20 years. His articles appear in many publications. He is also a speaker at the Intershow conferences. He has been on television and radio. He is author of many educational articles about stock investing and the book “Guide To High-Performance Investing.”
For information to subscribe to the Ticker Tape Digest Services call: B. J. Owen at 1-480-926-1680. Distributed by Corona Publishing Enterprises. Ticker Tape Digest Inc. P.O. Box 2044 Chandler, Az. 85244-2044. TTD “Professional Report” is available on the World Wide Web: $100 per month. Password needed. “TTD Professional“ Faxed is $200 per month. The TTD Daily Report is $39.95. Credit cards accepted.
(The information contained has been prepared from data deemed reliable but there is no guarantee of complete accuracy. Ticker Tape Digest Inc. is not affiliated with any broker, dealer or investment advisor. Nothing in this publication constitutes an offer, recommendation or solicitation to buy or sell any securities. Further research is advised. This report is copyrighted and no redistribution is permitted with out permission. Some of the charts are from Telescan, Insight Trading, First Alert and other sources.)